The Association of Superannuation Funds of Australia (ASFA) said tonight’s Federal Budget builds on the recent announcement targeting Superannuation Guarantee (SG) compliance and will boost retirement outcomes.
ASFA has consistently highlighted the detrimental impact of unpaid superannuation on retirement outcomes and recommended paying superannuation with wages, improving data matching utilising the enhanced reporting provided by funds, stronger ATO enforcement against
non-compliant employers and greater transparency of the ATO’s progress in recovering outstanding amounts.
“Missing out on superannuation entitlements means people have less retirement income. Every dollar counts in retirement and that’s why measures to improve SG compliance are so important,” said ASFA Deputy CEO, Glen McCrea.
The Budget will improve data matching capabilities by the ATO (including matching employers and super fund data at scale) and will allow the ATO to build a new compliance system to proactively identify instances of under or unpaid super in near-real time. There will also be public targets on the recovery of unpaid superannuation by the ATO and funding for the ATO to engage more effectively with business to address superannuation liabilities.
The Budget also amends the Non-Arm’s Length Income (NALI) provisions which apply to expenditure incurred by superannuation funds and exempts large APRA regulated funds from the NALI provisions for both general and specific expenses of the fund.
“The practical effect of the NALI amendment is that large APRA regulated superannuation funds can continue with existing service arrangements that are in the best financial interests of their members. ASFA has long advocated for appropriate targeting of the NALI provisions and appreciates the Government’s rigorous consultation and pragmatic decision.”
ASFA notes the Government will introduce several measures to increase support for social and affordable housing across the country, including increasing the Government-guaranteed liability cap of the National Housing and Finance Investment Corporation (NHFIC) by $2.0 billion to $7.5 billion.
“Superannuation funds are investing in NHFIC’s bond issuances and an increase in the Government-guaranteed liability cap will encourage further investment,” concluded Mr McCrea.
For further information, please contact:
Jacqui Maddock, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political, national organisation. ASFA’s mission is to continuously improve the superannuation system, so all Australians can enjoy a comfortable and dignified retirement.
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